Wingstop Inc Stock Fair Value – Investor Hedges Value Portfolio with Short of Wingstop
January 5, 2024
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As an investor, I have incorporated Wingstop Inc ($NASDAQ:WING). into my value portfolio as a hedge. It also operates franchised restaurants in the United States, Mexico, Colombia, Panama, Singapore, Indonesia, the United Arab Emirates, the Netherlands, and Malaysia. Their mission is to create an unforgettable flavor experience for their customers.
As a result, it has become an attractive short opportunity for investors looking to capitalize on a potential market decline. This makes it an ideal hedge for value portfolios, allowing investors to protect themselves against the potential volatility of the stock market while still benefiting from its long-term growth potential.
Share Price
Investors have recently demonstrated confidence in hedge funds by hedging their value portfolios with a short of Wingstop Inc. (WINGSTOP INC). On Thursday, WINGSTOP INC stock opened at $244.7 and closed at $243.2, down 0.6% from its previous closing price of 244.7. This news further indicates that investors are looking to diversify their investments in order to protect their portfolios from potential downturns. It appears that the hedge fund strategy used by these investors, which involves shorting certain stocks, is helping to limit the risk of their value portfolios. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Wingstop Inc. More…
| Total Revenues | Net Income | Net Margin |
| 437.87 | 68.96 | 15.8% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Wingstop Inc. More…
| Operations | Investing | Financing |
| 106.83 | -45.55 | -155.19 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Wingstop Inc. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 351.68 | 827.12 | -16.16 |
Key Ratios Snapshot
Some of the financial key ratios for Wingstop Inc are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 22.4% | 25.5% | 25.4% |
| FCF Margin | ROE | ROA |
| 16.8% | -16.6% | 19.8% |
Analysis – Wingstop Inc Stock Fair Value
At GoodWhale, we have been analyzing the financials of WINGSTOP INC and our proprietary Valuation Line has produced an intrinsic value per share of around $204.9. This means that, currently, WINGSTOP INC is being traded at a fair price of $243.2, which is 18.7% overvalued. It is still possible for investors to make a profitable investment on WINGSTOP INC; however, they should be aware of the fact that the stock price may drop in the future. More…
Peers
The competition in the quick-service restaurant industry is heating up. Wingstop Inc, a leading player in the chicken wing segment, is facing increased competition from Wowprime Corp, Various Eateries PLC, and Hostmore PLC. These companies are all vying for a share of the quick-service restaurant market and are each employing different strategies to gain an edge over their competitors. Wingstop Inc is well-positioned to compete against these rivals and maintain its position as a leading player in the industry.
– Wowprime Corp ($TWSE:2727)
Wiprime Corp, a 9.14B market cap company as of 2022, is a holding company with a -1.91% ROE. The company invests in a range of businesses including healthcare, education, and technology.
– Various Eateries PLC ($LSE:VARE)
Eateries PLC has a market cap of 34.27M as of 2022. The company has a Return on Equity of -5.88%. Eateries PLC is a restaurant company that operates in the United Kingdom.
– Hostmore PLC ($LSE:MORE)
Hostmore PLC is a U.K.-based holding company engaged in the operation of hotels. As of 2022, the company had a market capitalization of 22.07 million pounds and a return on equity of 2.42%. The company operates a portfolio of hotels in the United Kingdom, Spain, and Portugal.
Summary
Wingstop Inc. is an American restaurant chain that specializes in chicken wings. The company is best known for its fresh wings, sauces, and sides. Investing analysis of Wingstop Inc has revealed that it has a strong growth strategy, with plans to open new stores in the US and abroad. Analysts have attributed this growth to the success of the company’s marketing campaigns, as well as its focus on providing a superior customer experience. Wingstop’s relatively low-cost operating model also makes it attractive to investors, as it allows the company to generate higher margins than its competitors. In addition, Wingstop’s strong financials and solid balance sheet have provided investors with confidence in its short-term prospects.
However, with increased competition in the restaurant industry, Wingstop may face difficulty in sustaining its growth momentum.
